Bonuses to senior execs under fire at GSA, other agencies

Executive Editor Jason Miller on "In Depth" with Francis Rose

New details of just how troubled the management of the General Services Administration was between 2009 and 2011 are emerging. GSA's inspector general and Sen. Claire McCaskill (D-Mo.) released separate, but related, reports that show the agency abused its authority to give Senior Executive Service (SES) members bonuses.

McCaskill's report looks at SES bonuses governmentwide. She found GSA, in particular, led all other agencies in doling out cash awards to SES members at a rate of 1.6 bonuses to every SES employee.

In 2011 alone, McCaskill said GSA awarded $1.1 million in bonuses.

Her findings tie directly to a new IG report that showed between 2009 and 2011, GSA officials violated legal requirements for executive performance evaluation practices, which lead to bonuses, and SES award practices.

Violations abound

The IG also said GSA's SES award policy was inadequate. GSA violated record-retention requirements and didn't make accurate disclosures to either the Office of Personnel Management or Congress.

"We identified deficiencies in the GSA SES program that illustrate a willingness by GSA to violate legal requirements that resulted in an opaque evaluation and award system, with a manufactured process that failed to protect the rights of SES members, made review of the validity of individual awards impossible, and impeded review of the overall program," IG Brian Miller wrote in the report.

The problems identified by McCaskill and the IG were a part of the laundry list of management problems that came to light as part of the Western Regions Conference scandal. The events led to the ouster of then-Administrator Martha Johnson and two other senior leaders.

Since last April, GSA has undergone a management overhaul.

"Last year as part of a review of all agency operations, acting Administrator Dan Tangherlini cut executive bonuses by 85 percent," said Dan Cruz, a GSA spokesman in an email. "Additionally, the entire performance awards system has been reviewed, and the new leadership at GSA has worked to reform the system. As a result, GSA no longer has a peer-to-peer awards system. Under this administration, GSA bonuses are coming down to their lowest levels in five years."

Bonuses to SESers are "outrageous"

GSA is not alone in handing out SES bonuses that McCaskill said are over-the-top.

McCaskill found from 2008 to 2011, SESers received $340 million in cash bonuses, and 81 percent of all members received awards.

In 2011, the Labor Department, the Navy and the National Science Foundation awarded more than one bonus on average to every SES in their agency.

The Nuclear Regulatory Commission, the National Science Foundation, the Navy, the Department of Health and Human Services and the Department of Commerce gave, on average, more than $10,000 per SES employee.

"The idea that some of the highest paid federal government employees could be getting bonuses while others are being furloughed is outrageous," said McCaskill, chairwoman of the Homeland Security and Governmental Affairs Subcommittee on Financial and Contracting Oversight, in a release. "This legislation will ensure that doesn't happen."

McCaskill's bill, which was referred to the main committee, is already drawing criticism from some quarters.

Bill Bransford, general counsel of the Senior Executives Association, said McCaskill's report is "not quite accurate."

"While she presents them as highly paid, and they are higher paid than many federal employees, most people who look at this issue do consider SES under paid, and the performance awards are part of the pay for performance system.
The only thing that is pay for performance are the performance awards and to prohibit them all together doesn't let agencies reward it's very best. I'm not sure it's necessary to take away agency discretion."

Bransford, who hosts FEDTalk on Federal News Radio, said under sequestration and guidance from OPM and OMB, many agencies are reducing the amount of bonuses paid out anyways.

"McCaskill believes when lower paid employees don't get pay raises, SESers shouldn't get performance awards, but she ignores the fact that lower paid employees are eligible for locality pay, step increases and within-grade increases. All of these result in more money for GS employees, but SESers have no opportunity for raises or increases except based on their performance."